Eric Kraus

Monday August 11, 2014

Some ten years ago, as a financial strategist/fund manager in post-crisis Moscow, while laboring away over my strategy monthly “Truth and Beauty (and Russian Finance)” with its recurrent theme that Russia was embarking upon her New Asian Century (i.e. turning away from the West to build bridges to China), I was surprised to receive a polite rejoinder from one of my readers: the prominent Stanford academic Michael McFaul – even then seen as a rising star in Eastern European policy for the US Democrat Party.

The professorial McFaul gently admonished me that I was deeply misguided in my belief that the Russian Bear would embrace the Chinese Dragon. Quite the opposite, he intoned, “The Russians are so terrified of China that they will be forced to beg Washington for a military alliance – at whatever price the Pentagon sees fit to demand!”

The ensuing years have not been kind to that prediction. While we fund managers are judged upon our track records, and few careers would survive such a blunder, being a politician (or a journalist) means never having to say, “I’m sorry”.

A few years later, as US-Russian relations were becoming increasingly envenomed, McFaul was drafted in as ambassador to Moscow with a mission to salvage Obama’s desperately imperiled “Russia Reset.” A worse choice could hardly have been imagined.read on...